Tech capability increasingly decisive in placements as market softens, according to a survey of London market brokers
London market brokers are increasingly favouring insurers with advanced digital capabilities when deciding where to place business, according to new research from Guidewire.
The inaugural Guidewire London Market Tech Barometer surveyed more than 250 brokers who primarily place risks with London market insurers.
Nearly four in five respondents, 78%, said insurer technology plays a decisive or highly significant role in where they place risk.
Guidewire said this sentiment was even stronger among senior brokers and director level respondents, indicating that technology is now a strategic consideration rather than simply an operational preference.
When asked to identify the biggest impediment to modernisation in the London market, 24% of brokers cited reliance on outdated technology.
The study comes just days after it was revealed that the Lloyd’s market Blueprint Two plan for digital transformation has been shelved indefinitely.
The findings suggest that in a softening market, brokers are placing greater emphasis on efficiency and favouring carriers with modern systems.
The survey also found that firms are not waiting for Blueprint Two to complete before pursuing their own digital strategies.
Some 78% of respondents said they are progressing independently of the programme’s timeline.
Among those moving ahead, 31% expressed concern about insurers’ ability to integrate due to legacy core constraints.
Artificial intelligence (AI) is already playing a role in operational improvements.
The most cited AI use case was automating submission intake and data extraction, identified by 42% of brokers.
A further 38% pointed to AI’s role in enhancing exposure management.
More than half of brokers, 51%, said the shift towards algorithmic or fully digital underwriting is already underway.
Nearly half, 48%, viewed smart follow syndicates positively for their ability to speed up placement.
Jamie McDonnell, London market director at Guidewire, said: “London market broker loyalty is no longer anchored in history or relationships alone. In a softening market, where competition for business intensifies, modernisation is more critical than ever.”
He added: “This survey shows a clear majority of brokers favour technologically forward insurers. This reflects the need for stable, durable core operating platforms that can power the commitments the London market makes to customers around the world.”
McDonnell said insurers investing in resilient foundations are better placed to compete.
“Insurers that invest in resilient foundations – platforms that evolve with the pace of competition, enable seamless integration, and provide underwriters with the ability to leverage emerging tools, in the context they require – are better positioned to deliver consistently and compete dynamically,” he added.
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